South Korea FSS chief vows stronger cybersecurity after data breaches

Speaking in opening remarks at a parliamentary audit, Lee said the recent security breaches had caused great concern among the public and that the FSS would swiftly address security vulnerabilities by investigating their causes.

The remarks followed a series of cyberattacks earlier this month that hit about 16 local financial institutions, including banks, savings banks and insurance companies, and exposed about 100,000 cases of personal data across the industry, including email addresses, names and phone numbers.

Lee said he would encourage financial institutions to strengthen internal security capabilities using artificial intelligence technologies to respond effectively to AI-powered cyberattacks. He added that the FSS would consult with the Financial Services Commission to review various measures aimed at encouraging financial institutions to increase investment in security and personnel.

At the same audit, Lee acknowledged that single-stock leveraged exchange-traded funds launched in May partly contributed to sharp market volatility in June and July. He was responding to a question from Rep. Kim Jae-sub.

Lee said the FSS began reviewing the listing of the single-stock ETFs in April, before the Korea Exchange completed its preliminary examination, and that the review was expedited to meet the government's schedule for the products' launch on May 27. He said the FSS advanced the review process to meet the timeline and found no irregularities when it examined the Korea Exchange's preliminary examination results.

Single-stock ETFs linked to Samsung Electronics Co. and SK hynix Inc. had been widely viewed as a key factor behind sharp fluctuations in the domestic stock market. Amid rising criticism, financial authorities imposed strict measures to raise the entry bar and ease volatility.

Editor's Summary

Lee pledged a thorough investigation into the breaches that exposed about 100,000 personal data cases at roughly 16 financial institutions and said the FSS would consider steps to encourage security investment. He also acknowledged that single-stock leveraged ETFs partly contributed to market volatility and said the FSS expedited its listing review to meet the May 27 launch schedule.